KU to qualify for $35 million in additional ARPA funds, but doesn’t yet know how it wants to spend the federal money
photo by: Chad Lawhorn
It is not an exaggeration to say that University of Kansas leaders have 35 million things to think about this summer.
And, for the first time in a long time, those things are dollars.
The Kansas Board of Regents on Wednesday acknowledged that KU has qualified for at least $35 million in one-time money — and perhaps tens of millions more — in federal stimulus dollars related to the pandemic recovery.
All of the state’s Regents universities are set to receive varying amounts of ARPA money, the Regents reported Wednesday. The board received preliminary proposals on how the money would be spent from every university — except KU. Leaders at KU asked the board for additional time to think about how KU would spend the money.
“You want to be prudent about this because this is once-in-a-very-long-time type of money,” Jeff DeWitt, KU’s chief financial officer, said in a brief interview. “We may never see this money again.”
DeWitt said he would like to have the summer to study several possibilities for how KU could spend the money.
“It is my No. 1 assignment for the summer,” he said.
DeWitt said KU will focus on economic development type of projects when studying uses for the money. The governor’s office, which is administering the money, has emphasized using the federal funds to grow the state’s economy.
DeWitt said using the money to provide a substantial boost to KU’s planned development of Innovation Park on the West Campus is a possibility. KU leaders have talked extensively in recent months about their desire to build a slate of new buildings on KU’s West Campus that would attract both researchers and private companies that want to use that research.
By 2024, KU intends to build two new research buildings — each totaling about $30 million. One building would house what KU is calling the Kansas National Security Innovation Center, which would focus on research related to cybersecurity and other innovations that could be used by the homeland security or defense industries. A second building would house the Kansas Bio-Innovation & Sustainability Center, which would focus on research related to green energy and a host of environmental issues, among other topics.
But KU already has applied for a $50.8 million grant through the state of Kansas’ SPARK program, which also is funded through federal pandemic relief funds. KU leaders previously have said a state decision on that grant application could come this month. On Wednesday, DeWitt acknowledged that KU wanted to see the outcome of that grant application before settling on how to spend the $35 million in money now available through the Regents.
DeWitt said another project that will receive consideration is KU’s growing effort to attract more conventions and conferences to the Lawrence campus or in the community. KU hopes those efforts will ultimately produce more revenue for the university.
Upfront funding may be needed, though, to get the effort off the ground. DeWitt said, for instance, it is unclear whether KU and Lawrence have all the facilities they need to host conferences and conventions.
When asked whether KU might use the ARPA money for athletic facilities — there continues to be talk about KU’s need to improve its football stadium, for instance — DeWitt simply said KU would consider any project that provided good economic value to KU and the state.
At least one Regents school — Fort Hays State — is proposing to use its ARPA money for athletic facility improvements. The proposals submitted by the various universities provided a glimpse of how widely the ARPA money can be used. Here’s a look at the proposals:
• Kansas State hopes to use $25 million to partially fund new innovation centers related to grain, food, animal and agronomy research. K-State President Richard Linton told the Regents the project would involve the construction of three new buildings and the renovation of two others.
• Wichita State hopes to use $35 million to help fund a joint project with KU to build a new health education center in Wichita that will put KU’s Wichita medical school and WSU’s nursing and other medical programs under one roof.
• Emporia State hopes to use $5 million to move its nursing school from an off-campus location in Emporia into a remodeled dormitory building on ESU’s main campus. The move would allow the program to expand the number of nursing students ESU can serve.
• Pittsburg State hopes to use $5 million to further invest in a downtown Pittsburg mixed-used development that it helped construct in 2018. The project, in addition to housing and retail, includes business incubator space, which has a wait list. Separately, Pitt State hopes to access a second pot of ARPA money that would allow it to build a $7.5 million “prove-out facility” for its National Institute for Materials Research. The 20,000-square-foot center would be able to do small-scale manufacturing of new products that use research from the Pitt State materials laboratory.
• Fort Hays State hopes to use $5 million to install an air conditioning system in Gross Memorial Coliseum, the events center that hosts everything from basketball games to graduation ceremonies. By installing a new HVAC system, the university believes it will improve air quality and also boost the local economy by about $1 million a year by making the center more attractive to hosting summer events.
Touting benefits like improvement to air quality may be an important consideration in these projects. Regents noted on Wednesday that it is still unclear exactly what criteria the projects will have to meet to win approval from the Governor’s Recovery Office. But projects that can demonstrate they somehow are responding to the public health emergency or its negative economic impacts will likely get strong consideration, universities have been told.
While $35 million worth of ARPA money has been set aside for use specifically by KU, there is also another $75 million in ARPA funds potentially available to any Regents institution that comes up with a qualified project. However, those funds come with a major stipulation — the university must match every dollar of ARPA money with $3 of private funds.
Kansas State’s president said KSU is going to try to access some of those funds for its agriculture innovation centers, but he said deadlines associated with spending ARPA funding will create some real challenges. He said KSU believes projects would need to be completed by December 2026 to meet ARPA timelines. That means commitments would have to start being made very soon, so much so that KSU likely would need to raise about $75 million in private funds in about 60 days, he said.
In other news, the Regents gave final approval to new tuition rates at KU and all the Regents schools. All tuition rates remain unchanged from the last school year. Gov. Laura Kelly made flat tuition rates a condition of increased state funding for the universities. As reported, the Regents tentatively approved the tuition rates at last month’s meeting, but gave final approval on Wednesday. Some class fees at universities, however, did increase. KU’s School of Engineering registered the largest increase. Fees at the engineering school will increase to $95 per credit hour, up from $54.70 per credit hour. Engineering students at KU could face more than a $1,000 increase to attend KU next year, as a result. Regents approved the fee increase after hearing that the fee increase was needed to help pay graduate teaching assistants, purchase laboratory equipment and fund other instructional expenses.